Yes, the flat file schema is deployed in App1 application.
When the file is picked up, it will first go through the pipeline, with a flat file disassembler — "BTS.soap_encoding_1__1+anyType, Microsoft.BizTalk.GlobalPropertySchemas", and then then file go into an orchestration with a message defined by the schema.
The pipeline has been working fine for quite a long time, and then now just not working any more.